Editors’ note: Steve Nicosia is director of human insights at management consulting firm Jackman. 

Over the past several years, private-label products have become increasingly popular with consumers, and in 2020, private-label brands outpaced name brands for the fourth consecutive year. The rising interest has been mostly driven by an ever-expanding product selection and perceived improvements to product quality and trust. In fact, 89% of consumers trust private brands as much as national brands. Moreover, private-label products – which are often a lower-cost alternative to national brands – are perceived as being better value to consumers.

The perceived value and appeal of private-label brands are most evident in the grocery space. In the face of soaring food costs and ongoing economic uncertainty, many consumers are looking for ways to save on their grocery bill while not sacrificing on other important benefits, and private label offers them a satisfactory way to do so. 

However, there is more happening beneath the surface of these grocery shopping decisions, whether they are driven by the pandemic or not. The value that grocery shoppers see in private-label products is not as one-dimensional as it used to be. To unpack this, let’s explore the notion of value for consumers at large.

There are (and will always be) consumers who think of value solely in terms of price. For these shoppers, the price, discounts and cost-benefits are the key drivers that attract them to private-label products. However, the notion of value is becoming increasingly complex, and the gap between the traditional monetary variables of value and non-monetary variables (e.g., convenience, accessibility, reliability, consistency) is closing for many consumers. For a growing cohort of consumers, value can mean value-added services like personalization, knowledgeable staff, fast delivery and inspirational content. To others...